UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

 

 

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AVANTOR, INC.

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Table of Contents

 

 

Notice of 2022 Annual Meeting of Stockholders

 

 

    

Thursday, May 12, 2022		Online Virtual Meeting at
11:00 a.m. Eastern Time		www.virtualshareholdermeeting.com/AVTR2022

VIRTUAL STOCKHOLDERS MEETING

The Annual Meeting of Stockholders (“Annual Meeting”) of Avantor, Inc. (“Avantor” or the “Company”) will be held on Thursday, May 12, 2022 at 11:00 a.m. Eastern Time. This year’s Annual Meeting will be a completely “virtual meeting”, conducted via live audio webcast on the Internet. Stockholders will be able to listen to and participate in the meeting online, vote their shares electronically and submit questions during the meeting live by visiting www.virtualshareholdermeeting.com/AVTR2022. Participants will need the 16-digit control number included on their Notice of Internet Availability or proxy card to gain access to the meeting. Stockholders of record of Avantor common stock at the close of business on March 18, 2022 are entitled to vote online during the meeting. A list of these stockholders will be open for examination by any stockholder for any purpose germane to the Annual Meeting for a period of 10 days prior to the Annual Meeting at our principal executive offices at Radnor Corporate Center, Building One, Suite 200, 100 Matsonford Road, Radnor, Pennsylvania 19087, and electronically during the Annual Meeting at www.virtualshareholdermeeting.com/AVTR2022 when you enter your 16-Digit Control Number. You have received these proxy materials because our Board of Directors is soliciting your proxy to vote your shares at the 2022 Annual Meeting of Stockholders.

The purposes of the meeting are:

 

1.	to elect the directors named in this proxy statement to serve a one-year term expiring at the 2023 annual meeting of stockholders;

 

2.	to ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for 2022;

 

3.	to approve, on an advisory basis, named executive officer compensation;

 

4.	to transact such other business as may properly come before the meeting or any adjournment or postponement thereof.

Your vote is important. We encourage you to vote by proxy in advance of the Annual Meeting. Whether or not you plan to attend via live audio webcast, we hope you will vote as soon as possible. Your proxy materials include instructions on how to vote, including by Internet. If you hold your shares through a brokerage firm, bank, or other similar entity, please follow their instructions.

On behalf of Avantor’s Board of Directors,

 

Justin M. Miller

Executive Vice President, General Counsel and Secretary

This Notice of Annual Meeting and Proxy Statement, together with our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 were first made available to stockholders on or about April 1, 2022.

Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to Be Held on May 12, 2022: This Proxy Statement and our Annual Report are available free of charge at www.proxyvote.com, a site that does not have “cookies” that identify visitors to the site.

Proxy Summary

This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all of the information that you should consider. You should read the entire proxy statement and Avantor’s 2021 Annual Report on Form 10-K before voting.

2022 ANNUAL MEETING OF STOCKHOLDERS

 

Time and Date:		11:00 a.m. Eastern Daylight Time, May 12, 2022
Location:		Online “virtual meeting” at www.virtualshareholdermeeting.com/AVTR2022. Stockholders will need to enter their 16-digit control number included on their Notice of Internet Availability or proxy card in order to participate.
Record Date:		March 18, 2022
Voting:		Stockholders as of the record date are entitled to vote. Each share of common stock is entitled to one vote for each director nominee and one vote for each of the other proposals to be voted on.

HOW TO CAST YOUR VOTE

Your vote is important! Please cast your vote and play a part in the future of Avantor. You may vote using any one of the following methods. In all cases, you should have your 16-Digit Control Number from your Notice of Internet Availability or proxy card available and follow the instructions.

 

Internet Before the Annual Meeting at www.proxyvote.com		calling 1-800-690-6903 toll-free from the U.S. or Canada		mail return the signed proxy card		Virtual Meeting only if you were an eligible stockholder
Please refer to the enclosed proxy materials or the information forwarded by your bank, broker, trustee or other intermediary to see which voting methods are available to you.

Web links throughout this document are provided for convenience only, and the content on the referenced website does not constitute a part of this Proxy Statement.

MEETING AGENDA AND VOTING RECOMMENDATIONS

 

    

				Board vote recommendation		Page reference (for more detail)
Item 1 –		Election of Each of the Eleven Directors Named in this Proxy Statement to Serve a One-Year Term Expiring in 2023		✓ FOR Each Nominee		8
Item 2 –		Ratification of Appointment of Deloitte & Touche LLP as the Company’s Independent Registered Public Accounting Firm for 2022		✓ FOR		31
Item 3 –		Advisory Approval of Named Executive Officer Compensation		✓ FOR		34

 

		2022 Proxy Statement    1

PERFORMANCE HIGHLIGHTS

Avantor’s role in enabling scientific breakthroughs has never been more important. Supporting our customers from discovery to delivery is how we set science in motion to create a better world. Our proven business model and our ability to execute, enabled by the Avantor Business System, created value for our stockholders in 2021. This performance was driven by more than 13,500 passionate Avantor associates relentlessly advancing life-changing science.

FINANCIAL HIGHLIGHTS

 

See Appendix A for information about our non-GAAP financial measurements, including reconciliations to the most directly comparable GAAP-based financial measurements.

 

2    2022 Proxy Statement

STRATEGIC INITIATIVES

In 2021, we completed several investments to enhance our portfolio of proprietary offerings and support our continued growth. M&A was prominent as we deployed more than $4 billion to close three acquisitions that strengthened our offerings for life science research, bioproduction, and healthcare. We also completed several supply chain investments to increase manufacturing capacity and expand our footprint to better serve growing customer demand. Innovation plays an integral role for us and we leveraged the Avantor Business System to enhance the impact on growth from our investments in new product introductions.

 

 

 

 

 

 

 

		2022 Proxy Statement    3

CORPORATE GOVERNANCE HIGHLIGHTS

The Company is committed to good corporate governance, which we believe is important to the success of our business and in advancing stockholder interests.

Corporate Governance Highlights include:

 

 

 

Separate Chairman and CEO roles		10 out of 11 Board Members are independent		Regular Executive Sessions of Independent Directors		Risk Oversight by the Full Board and its Committees

 

Annual Board and Committee Self-Evaluations		Policies Prohibiting Short Sales, Hedging, Margin Accounts and Pledging of stock by Directors and Officers		No classified board

 

Proxy access for stockholders		Majority voting standard in uncontested elections of directors and a resignation policy applicable to incumbent directors not receiving the requisite vote		20% threshold for stockholders to call a special meeting

Our corporate governance practices are described in greater detail in the “Corporate Governance” section.

 

4    2022 Proxy Statement

BOARD NOMINEES

Avantor’s Board of Directors has twelve members and, as a result of the retirement of Rajiv Gupta, following the Annual Meeting, will have eleven members. All director nominees currently serve on the Board and will be elected for a one-year term expiring at the next annual meeting of stockholders.

The following table provides summary information about each director nominee standing for re-election at the Annual Meeting.

 

 

    

Name

Age

Director Since

Principal Occupation

Independent

Committee Memberships

Juan Andres

57

2019

Chief Technology Operations and Quality Officer, Moderna, Inc.

Yes

Audit & Finance

John Carethers, M.D.

58

2021

Professor and Chair of Internal Medicine, University of Michigan

Yes

Nominating & Governance

Matthew Holt

45

2010

Managing Director and President, Private Equity, New Mountain Capital, LLC

Yes

Compensation & Human Resources (Chair)

Lan Kang

53

2021

Managing Director, CBC Group

Yes

Audit & Finance

Joseph Massaro

52

2021

Chief Financial Officer and Senior Vice President, Business Operations, Aptiv, Inc.

Yes

Audit & Finance (Chair)

Mala Murthy

58

2021

Chief Financial Officer, Teladoc Health, Inc.

Yes

Audit & Finance

Jonathan Peacock

64

2017

Retired Corporate Executive including CFO at Amgen Inc. and Novartis Pharm AG

Yes

Nominating & Governance

Michael Severino, M.D.

56

2020

Vice Chairman & President, AbbVie, Inc.

Yes

Audit & Finance Compensation & Human Resources

Christi Shaw

55

2018

Chief Executive Officer, Kite, a Gilead Company

Yes

Compensation & Human Resources Nominating & Governance

Michael Stubblefield

49

2014

President and Chief Executive Officer, Avantor, Inc.

No

Gregory Summe

65

2020

Managing Partner, Glen Capital Partners

Yes

Compensation & Human Resources Nominating & Governance (Chair)

 

 

		2022 Proxy Statement    5

SUSTAINABILITY HIGHLIGHTS

As a global industry leader, we recognize our ability to create a positive impact for our associates, customers, suppliers stockholders and communities. Throughout 2021, we advanced our environmental, social and governance (ESG) strategy across our four pillars.

 

 

    

PILLAR		GOAL		SPOTLIGHTS ON PROGRESS
		• Increase management diversity   • Achieve top health & safety performance		• Between 2020 and 2021, launched 5 Associate-Centric Teams (ACTs) to promote awareness, respect and inclusion within the workplace and offer associates community, camaraderie and connection.   • Women represented nearly 35% of our management team in 2021   • 100% of Executive Leadership Team and all direct reports (Senior Leadership Team) completed diversity training and unconscious bias interactive workshops   • Set and achieved aggressive senior leadership (VP and above) representation goals in 2021   • Established partnerships with diverse recruitment partners to drive more diverse candidate pools   • Launched a Bring Your Own Device (BYOD) pilot to enable engagement for non-wired associates.
		• Reduce operational greenhouse gas (GHG) emissions by 15% by 2025		• Announced our first environmental sustainability target.   • Developed an energy and emissions reduction roadmap to invest in energy efficiency and conservation projects that will optimize our operational processes, in addition to lowering our operating emissions.
		• Improve global access to STEM education and healthcare.   • Increase associate volunteer hours		• Provided more than $6 million to support greater access to healthcare and advance STEM education through our Avantor Foundation since its inception in 2009   • In 2021, Avantor Foundation donated more than $1 million to 16 organizations across 12 countries   • Established a formal volunteer program policy that provides a global process and approval method to empower associates to participate in service activities aligned to our giving strategy   • Hosted organized volunteer events including: creating 600 STEM kits that were donated to Girls Inc. in Greater Philadelphia and Southern New Jersey and volunteering time with Stemettes, an award-winning organization that works with young women ages 5-21 to inspire careers in STEM in the United States, United Kingdom and Ireland
		• Launch Avantor Responsible Supplier Program		• Published Responsible Supplier Code of Conduct   • Engaged top suppliers to pilot a new program to manage risk and improve responsible business practices throughout our value chain.   • Continued to adopt best-in-class governance provisions, including several enhancements to stockholder rights, and an enhanced supplier code of conduct.

 

6    2022 Proxy Statement

EXECUTIVE COMPENSATION HIGHLIGHTS

As part of its annual review of our executive compensation program, the Compensation and Human Resources Committee confirmed several long-standing Avantor compensation policies and practices and adopted certain new policies and practices to further align our executive compensation program with stockholder interests.

Our executive compensation practices include the following, each of which the Compensation and Human Resources Committee believes reinforces our executive compensation objectives:

 

✓ Significant percentage of target annual compensation delivered in the form of variable compensation tied to performance   ✓ Long-term objectives aligned with the creation of stockholder value   ✓ Market comparison of executive compensation against a relevant peer group   ✓ Robust stock ownership guidelines   ✓ Use of an independent compensation consultant reporting directly to the Compensation and Human Resources Committee   ✓ Compensation recovery (“clawback”) policy for our annual cash-based incentive and equity based long-term incentive programs				×  No hedging or short sales of Company stock, or pledging of Company stock   ×  No multi-year employment contracts   ×  No option grants below 100% fair market value   ×  No excessive severance benefits upon a change of control   ×  No excessive perquisites or benefits to executives   ×  No repricing of underwater stock options under our long-term incentive plan   ×  No tax gross-ups of perquisites or 280G excise taxes (except as applicable to management employees generally in connection with relocation or expatriate assignments)   ×  No guaranteed equity or bonuses

2021 Named Executive Officer Compensation

The following table reflects compensation awarded to the Company’s named executive officers in 2021. See Compensation Discussion and Analysis beginning on page 35 for more details, including information regarding 2020 and 2019 compensation, as well as footnotes.

 

 

    

Name and Principal Position		Salary ($)				Bonus ($)				Stock Awards ($)				Option Awards ($)				Non-Equity Incentive Plan Compensation ($)				Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)				All Other Compensation ($)				Total ($)
Michael Stubblefield Director, President and Chief Executive Officer			1,085,000				—				6,633,149				2,000,000				3,523,212				5,342				14,210				13,260,913
Thomas Szlosek Executive Vice President and Chief Financial Officer			600,000				—				1,492,479				449,998				1,771,200				5,592				16,674				4,335,943
Frederic Vanderhaegen Executive Vice President Americas & Europe			579,674				—				1,492,479				449,998				962,718				—				80,238				3,565,108
Gerard Brophy Executive Vice President Biopharma Production			513,462				—				1,492,479				449,998				862,406				5,557				15,018				3,338,920
Sheri Lewis Executive Vice President, Global Operations & Supply Chain			469,519				250,000				1,243,687				375,000				560,880				—				14,887				2,913,973

 

		2022 Proxy Statement    7

Item 1 Election of Directors

The number of authorized directors is currently twelve and may be changed by resolution of our Board of Directors. At this Annual Meeting, all directors will be elected for a one-year term expiring at the next annual meeting of stockholders.

Rajiv Gupta, the current Chairman and director, has decided not to stand for re-election. The Company is sincerely grateful for Mr. Gupta’s years of service. If re-elected Jonathan Peacock, our current Lead Independent Director, will succeed Mr. Gupta as our Chairman.

The biographies below describe the business experience of each director nominee standing for re-election. Following the biographical information for each director nominee, we have listed the specific experience and qualifications of that nominee that strengthen the Board of Directors’ collective qualifications, skills and experience.

In considering each director nominee for election at the Annual Meeting, the Nominating and Governance Committee assessed the contributions of those directors recommended for re-election in the context of the Board evaluation process and other perceived needs of the Board. When considering whether the directors and nominees have the experience, qualifications, attributes and skills, taken as a whole, to enable the Board to satisfy its oversight responsibilities effectively in light of our business and structure, the Board focused primarily on the information discussed in each board member’s biographical information and the Director Skills Matrix set forth below. We believe that our directors provide an appropriate mix of experience and skills relevant to the size and nature of our business. This process resulted in the Board’s nomination of the incumbent directors named in this Proxy Statement and proposed for election by you at the upcoming Annual Meeting.

The Board expects that each of the nominees listed below will be available for election as a director. However, if one or more of the nominees is not available for election, the persons named in the form of proxy have advised that they will vote for any substitute nominees as the Board may nominate. If a nominee is not available for election or is otherwise unable to serve as a director, the Board may reduce its size or choose a substitute nominee.

 

				The Board of Directors unanimously recommends a vote “FOR” the election of each of the directors listed below to the Board for a one-year term expiring in 2023.

 

8    2022 Proxy Statement

DIRECTOR SKILLS MATRIX

Our directors possess relevant skills and experience that contribute to a well-functioning Board that effectively oversees our strategy and management.

 

 

    

Director Nominee Skills and Experience

Andres

Carethers

Holt

Kang

Massaro

Murthy

Peacock

Severino

Shaw

Stubblefield

Summe

Board leadership as a board chair, lead director or committee chair equips directors to lead our Board and its Committees

✓

✓

✓

✓

Financial expertise as a finance executive or CEO brings valuable experience to the Board and our management team

✓

✓

✓

✓

✓

✓

✓

✓

✓

M&A/Transactional experience helps the Board and our management team assess acquisition opportunities consistent with our strategic priorities and long-range plans

✓

✓

✓

✓

✓

✓

✓

✓

Operations experience increases the Board’s understanding of our manufacturing operations, services opportunities and distribution footprint

✓

✓

✓

✓

✓

✓

✓

Regulatory/legal/public policy experience helps the Board assess and respond to an evolving business and healthcare regulatory environment

✓

✓

✓

✓

✓

✓

✓

International experience brings critical insights into the opportunities and risks of our international businesses

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

 

		2022 Proxy Statement    9

DIRECTOR NOMINEES TO SERVE FOR A ONE-YEAR TERM EXPIRING IN 2023

 

 

    

Juan Andres
Director since: 2019   Age: 57   Committees: •  Audit & Finance		Mr. Andres has served on our Board since September 2019 and is currently a member of the Audit and Finance Committee. Mr. Andres is the Chief Technical Operations and Quality Officer for Moderna, Inc., a biotechnology company specializing in mRNA vaccines and therapeutics, a position he has held since August 2017. From 2005 to 2017, Mr. Andres served in several leadership positions at Novartis AG, a global healthcare company, most recently serving as the Global Head of Technical Operations (Manufacturing and Supply Chain) and before that as Group Novartis Quality Head, Global Head of Technical Research and Development, and Global Pharmaceuticals Operations Head. Prior to 2005, Mr. Andres spent 18 years at Eli Lilly Company, a global healthcare company, serving in a variety of leadership positions. Mr. Andres serves on the board of directors and as a member of the Nominating and Corporate Governance and Science and Technology Committees of Evelo Biosciences, Inc. Mr. Andres holds a masters’ degree in Pharmacy from Alcala de Henares University in Madrid, Spain and has completed an advanced development program at the London Business School.
Experience and Qualifications Mr. Andres’ extensive experience in pharmaceutical manufacturing, supply chain and technical research, along with his independence, make him a valuable member of our Board.

 

 

    

John Carethers, M.D.
Director since: 2021   Age: 58   Committees: •  Nominating & Governance		Dr. Carethers has served on our Board since July 2021 and is currently a member of the Nominating & Governance Committee. He is the John G. Searle Professor and Chair of the Department of Internal Medicine at the University of Michigan Medical School based in Ann Arbor, Michigan, a position he has held since 2009. He is a Professor of Human Genetics and became an elected fellow of the Royal College of Physicians in 2021. Additionally, he was elected as a member of the National Academy of Medicine in 2012. Prior to 2009, Dr. Carethers served in a variety of roles at the University of California, San Diego, including as a professor of Medicine and Chief of the Division of Gastroenterology. Dr. Carethers holds an M.D., as well as a Bachelor of Science in biological sciences from Wayne State University, completing his internship and residency in internal medicine at Massachusetts General Hospital and his fellowship in gastroenterology at the University of Michigan.
Experience and Qualifications Dr. Carethers’ senior leadership experience at a medical college and extensive research experience in familial cancer syndromes, including tumor genetics, DNA mismatch repair, and colorectal cancer disparities, along with his independence, make him a valuable member of our Board.

 

10    2022 Proxy Statement

 

    

Matthew Holt
Director since: 2010   Age: 45   Committees: •  Compensation & Human Resources (Chair)		Mr. Holt has served on our Board since 2010 and is Chair of the Compensation & Human Resources Committee. Mr. Holt is a Managing Director of New Mountain Capital, LLC, a private equity investment firm based in New York, New York. He serves as the President of Private Equity at New Mountain Capital and focuses on growth buyouts across a range of industries including healthcare products, health technology, materials and infrastructure. He previously worked in the Mergers and Acquisitions Group at Lehman Brothers, a financial services firm, from 1999 to 2001. He currently serves as Chairman of Signify Health and as the director of a number of privately-held companies. Mr. Holt has previously served as Lead Director of Bellerophon Therapeutics, Inc. Mr. Holt earned an A.B. in English and American Literature and Language from Harvard College.
Experience and Qualifications Mr. Holt’s experience as a Managing Director of New Mountain Capital, board and advisory experience with other companies in the healthcare industry and his extensive experience in the areas of finance, strategy, international business transactions and mergers and acquisitions, make him a valuable member of our Board.

 

 

    

Lan Kang
Director since: 2021   Age: 53   Committees: •  Audit & Finance		Ms. Kang has served on our Board since 2021 and is currently a member of the Audit & Finance Committee. Ms. Kang is a Managing Director at CBC Group, a healthcare-focused private equity investment firm based in Shanghai, China, a position she has held since December 2020, and serves on the board of directors of Everest Medicines. Previously, Ms. Kang served as a Senior Advisor to Shanghai Henlius Biotech, a global clinical-stage biopharma company. Ms. Kang also served in a variety of roles at Fosun International, a Hong Kong stock exchange listed, consumer-focused multinational company, including Executive Board Director, Chief Human Resources Officer and Head of the Fosun Insurance Group. Prior to Fosun, she was a Senior Client Partner at Korn Ferry International and was an Engagement Manager at McKinsey & Company. Ms. Kang holds an MBA in healthcare management from The Wharton School of the University of Pennsylvania, a master’s degree in chemistry from Tulane University and a bachelor’s degree in biological science and technology from Zhejiang University in Hangzhou, China.
Experience and Qualifications Ms. Kang’s extensive experience in healthcare and biopharma, current and past experience as a board member at other companies and her expertise in finance, strategy, international business transactions, along with her independence, make her a valuable member of our Board.

 

		2022 Proxy Statement    11

 

    

Joseph Massaro
Director since: 2021   Age: 52   Committees: •  Audit & Finance (Chair)		Mr. Massaro has served on our Board since 2021 and is Chair of the Audit & Finance Committee. Mr. Massaro currently serves as Chief Financial Officer and Senior Vice President, Business Operations for Aptiv, Inc., a position he has held since September 2016. Prior to that, Mr. Massaro held several senior executive positions at Aptiv including Vice President and Corporate Controller. He also previously served as Chief Financial Officer at inVentiv Health and as a Managing Director at Liberty Lane. Mr. Massaro earned an MBA and a Master of Science in accounting from Northeastern University. He holds a Bachelor of Science in finance and economics from Bentley University.
Experience and Qualifications Mr. Massaro’s senior leadership experience, including as a Chief Financial Officer, and his expertise in international business transactions, strategy and financial accounting (including qualification as an audit committee financial expert), along with his independence, make him a valuable member of our Board.

 

 

 

    

Mala Murthy
Director since: 2021   Age: 58   Committees: •  Audit & Finance		Ms. Murthy has served on our Board since 2021 and is a member of the Audit & Finance Committee. Ms. Murthy currently serves as the Chief Financial Officer for Teladoc Health, Inc., a position she has held since June 2019. Prior to that, Ms. Murthy held several senior executive positions at American Express, most recently as Chief Financial Officer of the Global Commercial Services segment. She also previously served in various leadership positions with PepsiCo, leading high growth business units. Ms. Murthy earned an MBA from the India Institute of Management, a master’s degree in public and private management from Yale School of Management, and a bachelor’s degree in computer science and engineering from Jadavpur University in India.
Experience and Qualifications Ms. Murthy’s senior leadership experience, including as a Chief Financial Officer, and her expertise in international business transactions, financial accounting and strategic growth (including qualification as an audit committee financial expert), along with her independence, make her a valuable member of our Board.

 

12    2022 Proxy Statement

 

    

Jonathan Peacock
Director since: 2017   Age: 64   Committees: •  Nominating & Governance		Mr. Peacock is our Lead Independent Director and has served on our Board since 2017. He is a member of the Nominating and Governance Committee. From 2016 to 2021, Mr. Peacock served as Chairman of Bellerophon Therapeutics, Inc. a clinical state biotherapeutics company, and served as its Chairman and CEO from 2014 to 2016. Prior to that time, Mr. Peacock served as the Chief Financial Officer of Amgen, Inc., a biopharmaceutical company, from 2010 to 2014 and was the Chief Financial and Administrative Officer of the Pharmaceuticals Division of Novartis AG, a global healthcare company, from 2005 to 2010. Previously he was a partner at McKinsey and Price Waterhouse. Mr. Peacock serves as a director of UCB SA, where he is Chair of the Audit and Finance Committee. In the past five years, Mr. Peacock was a founder and Chairman of Arix Bioscience PLC, and served as a director of Kite Pharma and Genmab A/S. Mr. Peacock earned a M.A. in Economics from the University of St. Andrews in Scotland and is a Chartered Accountant.
Experience and Qualifications Mr. Peacock’s prior senior leadership experience at several companies, including as chief executive officer and chief financial officer, current and past experience as a board member at other companies and his expertise in finance, strategy, international business transactions, mergers and acquisitions and operations along with his independence, make him a valuable member of our Board.

 

 

    

Michael Severino, M.D.
Director since: 2020   Age: 56   Committees: •  Audit & Finance •  Compensation & Human Resources		Dr. Severino has served on our Board since April 2020 and is a member of the Audit & Finance Committee and Compensation & Human Resources Committee. Dr. Severino currently serves as Vice Chairman and President of AbbVie Inc. Prior to this role, Dr. Severino served as AbbVie’s Executive Vice President, Research & Development, and its Chief Scientific Officer. He also spent 10 years at Amgen, Inc., serving in a variety of leadership positions, including Senior Vice President, Global Development, and Chief Medical Officer. Dr. Severino also serves on the board of directors for the Field Museum in Chicago, Illinois. He earned an M.D. from Johns Hopkins University, completing his residency and fellowship training at Massachusetts General Hospital and Harvard Medical School, as well as a bachelor’s degree in biochemistry from the University of Maryland.
Experience and Qualifications Dr. Severino’s extensive experience in research and development and corporate strategy for leading companies focused on developing life-saving therapies for patients, along with his independence, makes him a valuable member of our board.

 

		2022 Proxy Statement    13

 

    

Christi Shaw
Director since: 2018   Age: 55   Committees: •  Compensation & Human Resources •  Nominating & Governance		Ms. Shaw has served on our board since November 2018 and is a member of the Compensation & Human Resources Committee and the Nominating & Governance Committee. Ms. Shaw is the Chief Executive Officer of Kite, a Gilead company specializing in the development of cancer immunotherapies, a position she has held since August 2019. From April 2017 to August 2019, Ms. Shaw served as Senior Vice President of Eli Lilly Company, a global healthcare company, and President of Lilly Bio-Medicines, the business within Eli Lilly Company that comprises neuroscience and immunology. From 2014 to 2016, Ms. Shaw served as U.S. country head and President of Novartis Pharmaceutical Corporation, a global healthcare company, and from 2010 to 2014 as North American region head of Novartis Oncology. Prior to 2010, Ms. Shaw held several leadership positions at Johnson & Johnson, Inc. Ms. Shaw also serves as an executive board member of the Biotechnology Innovation Organization and is the co-founder of the More Moments More Memories Foundation to assist people with cancer and their caregivers. Ms. Shaw holds a B.B.A. in Marketing from Iowa State University and an M.B.A. from the University of Wisconsin.
Experience and Qualifications Ms. Shaw’s extensive senior leadership experience within the healthcare industry and service as a Board Member of a large biotechnology trade organization, along with her independence, make her a valuable member of our Board.

 

 

    

Michael Stubblefield
Director since: 2014   Age: 49		Mr. Stubblefield became our President and Chief Executive Officer in 2014. In addition, Mr. Stubblefield also serves as a Director. Prior to joining us, Mr. Stubblefield was a Senior Expert for the Chemicals Practice of McKinsey & Company, a management consulting firm, from 2013 to 2014. Previously, he held a variety of leadership roles at Celanese Corporation, a technology and specialty materials company, from 1994 to 2012. Mr. Stubblefield holds a B.S. in Chemical Engineering from the University of Utah, as well as an M.B.A. from Texas A&M University-Corpus Christi.
Experience and Qualifications Mr. Stubblefield’s leadership role and extensive knowledge of our business, strategy and industry on an international basis make him a valuable member of our Board.

 

 

14    2022 Proxy Statement

 

    

Gregory Summe
Director since: 2020   Age: 65   Committees: •  Nominating & Governance (Chair) •  Compensation & Human Resources		Mr. Summe has served on our Board since May 2020 and is Chair of the Nominating & Governance Committee and a member of the Compensation & Human Resources Committee. Mr. Summe is the Managing Partner of Glen Capital Partners, an investment fund. He also serves on the board of directors of the State Street Corporation, Virgin Orbit Holdings, Inc., and NXP Semiconductors NV. Previously, he was the Co-founder of NextGen Acquisition Corp I & II and the Managing Director and Vice Chairman of Global Buyout at The Carlyle Group. He also spent 11 years as the Chairman and Chief Executive Officer of PerkinElmer. Before PerkinElmer, Mr. Summe was with AlliedSignal, now Honeywell International, serving as the President of General Aviation Avionics, President of the Aerospace Engines Group and President of the Automotive Products Group. Mr. Summe holds an MBA with distinction from The Wharton School of the University of Pennsylvania, a master’s degree in electrical engineering from University of Cincinnati and a bachelor’s degree in electrical engineering from University of Kentucky. He is in the Hall of Distinction at the University of Kentucky.
Experience and Qualifications Mr. Summe’s extensive leadership experience in key industries, including life sciences and applied materials, along with his independence, make him a valuable member of our Board.

 

 

 

		2022 Proxy Statement    15

Corporate Governance

Our success is built on the trust we have earned from our customers, suppliers, distributors, associates, business partners and investors, and trust sustains our success. Part of this trust stems from our commitment to good corporate governance. The framework for our governance practices is found in our Corporate Governance Guidelines, which outline the operating principles of our Board of Directors and the composition and working processes of our Board and its committees. The Nominating and Governance Committee periodically reviews our Corporate Governance Guidelines and developments in corporate governance and will sometimes recommend proposed changes to the Board for approval.

In addition to the Corporate Governance Guidelines and the other policies and procedures described in this section, we highlight below certain of our corporate governance practices and recent enhancements to our governance documents:

Board Membership and Participation

 

✓	Directors are expected to spend the time needed and meet as often as necessary to discharge their responsibilities properly.

✓	It is expected that no director will serve on more than five public company boards (including Avantor’s Board).

✓	It is expected that no member of the Audit and Finance Committee will serve on more than three public company Audit and Finance Committees (including Avantor’s Audit and Finance Committee).

✓	Directors who also serve as executive officers or in equivalent positions generally should not serve on more than two public company boards (including Avantor’s Board).

Prohibitions against Short Sales, Hedging, Margin Accounts and Pledging

Our Insider Trading Policy contains restrictions applying to all directors, officers and employees that, among other things:

✓	prohibit short sales of Avantor securities and derivative or speculative transactions in Avantor securities;

✓	prohibit the use of financial instruments (including prepaid variable forward contracts, equity swaps, collars and exchange funds) that are designed to hedge or offset any decrease in the market value of Avantor securities; and

✓	prohibit holding Avantor securities in margin accounts or pledging Avantor securities as collateral for a loan.

Robust Stockholders Rights

 

✓	Directors must be elected under a “majority voting” standard in uncontested elections. In addition, directors who do not receive the requisite votes for re-election must resign, subject to acceptance of such resignation by the Board;

✓

Each stockholder, or a group of up to 20 stockholders, that has continuously owned for three years at least 3% of our outstanding common shares, may nominate and include in the annual meeting proxy materials up to the greater of two directors or 20% of the number of directors serving on the Board, if the stockholder(s) and the nominee(s) meet the requirements specified in our bylaws; and

✓	The Company does not have a poison pill, and “declawed” the Company’s preferred stock such that it would not be used, without seeking stockholder approval, in connection with a poison pill.

Recent Changes Approved by Stockholders at the 2021 Annual Meeting of Stockholders

 

✓	Stockholders of record who own common shares representing at least 20% of the relevant voting power continuously for at least one year can call a special meeting of stockholders, provided that the stockholders satisfy specified requirements.

✓

Majority voting standard recently replaced the 66 2/3% voting requirements in our second amended and restated certificate of incorporation with a majority voting standard; as a result, any future action by stockholders to alter, amend or repeal our certificate of incorporation or bylaws can be approved by the affirmative vote of a majority of the outstanding stock entitled to vote thereon, and a majority of the outstanding stock of each class entitled to vote thereon as a class.

 

16    2022 Proxy Statement

THE STRUCTURE AND ROLE OF THE BOARD OF DIRECTORS

Board Leadership Structure

The Company’s Board is led by a non-executive Chairman. As announced earlier this year, our current Chairman, Mr. Gupta, is retiring at the end of his current term and is being replaced by Mr. Peacock. The Board believes that it is in the best interest of the Company and its stockholders for Mr. Peacock, who served as our Lead Independent Director, to now serve as Chairman of the Board. Mr. Peacock possesses significant knowledge and experience in our industry and a deep understanding of Avantor’s strategic objectives, all of which will continue to benefit the Company during the year ahead. We believe that having an independent, non-executive Chairman emphasizes the importance of the Board’s objectivity and independence from management and best promotes the effective functioning of the Board’s oversight role. Mr. Peacock’s responsibility is to ensure that our Board functions properly and to work with our President and Chief Executive Officer to set the Board’s agenda. We expect him to facilitate communications among our directors and between the Board and senior management. While Mr. Peacock provides independent leadership, he also works closely with our Chief Executive Officer to ensure that our directors receive the information that they need to perform their responsibilities, including discussing and providing critical review of the matters that come before the Board and assessing management’s performance.

Although we believe that the separation of the Chairman and Chief Executive Officer positions is appropriate corporate governance for us at this time, our Board believes that the Company and stockholders are best served by maintaining flexibility to determine whether and when the Chairperson and CEO positions should be separate or combined to provide the appropriate leadership.

The Board’s Role in Risk Oversight

While senior management has primary responsibility for managing risk, the Board has responsibility for risk oversight with specific risk areas delegated to relevant Board committees who report on their deliberations to the Board. The specific risk areas of focus for the Board and each of its committees are summarized below.

 

 

    

Board/Committee		Primary Areas of Risk Oversight
Full Board		• Oversee the Company’s risk governance framework, including an enterprise-wide culture that supports appropriate risk awareness and the identification, escalation, and appropriate management of risk • Integrity, ethics, and compliance with its Code of Ethics and Conduct • General strategic and commercial risks • M&A transactions, including execution and integration, and the M&A competitive landscape • Legal risks such as those arising from litigation, environmental, and intellectual property matters
Audit and Finance Committee		• Oversee and coordinate with the Company’s internal and external auditors • Accounting, controls and financial disclosure • Oversee the Company’s Enterprise Risk Management (ERM) program • Cybersecurity risk, including our information security framework, threat assessment, response readiness and training efforts • Tax and liquidity management
Compensation and Human Resources   Committee		• Compensation structure and programs • CEO succession planning • DE&I initiatives • Recruitment and retention of talent • Workplace culture • Workplace health, safety and well-being
Nominating and Governance Committee		• Governance structures and processes • Board organization, independence and structure • Board succession and effectiveness • Oversee the Company’s ESG initiatives

 

		2022 Proxy Statement    17

Enterprise Risk Management

The Board uses the ERM program as a key tool for understanding the inherent risks facing Avantor and assessing whether management’s processes, procedures and practices for mitigating those risks are effective. The ERM assessment deployed by management is based on an enterprise-wide “top down” and “bottom up” view of commercial, strategic, legal, compliance, human capital, cyber, and reputational risks and strategies for mitigating those risks. In 2021, the ERM program included consideration of risks in 10 distinct risk categories and 30 key risks overall. Each risk was the subject of an intensive risk workshop, led by a global risk owner and attended by multi-functional teams of Avantor associates. The Company’s Risk Committee performed a rigorous review of the work completed in each risk category and for all 30 individual risks, resulting in an overall risk score and an assessment of our current capabilities in managing top risks.

Both the Audit and Finance Committee and the Board review the results of the annual ERM assessment. During the reviews, Avantor’s General Counsel and Chief Accounting Officer jointly present the results of the ERM assessment in a manner designed to provide full visibility into the risks facing Avantor and how management is mitigating those risks, thereby enabling the Board to effectively exercise its oversight function. To facilitate continued monitoring and oversight by the Board, key risk areas identified during the ERM process and management’s associated mitigation activities become part of Board and/or committee meeting agendas for the following year.

Executive Sessions

To ensure free and open discussion and communication among the non-management directors of the Board, the non-management directors meet in executive session at most Board meetings, and the independent directors separately meet in a private session at least once a year that excludes management and directors who have not been determined to be independent. The lead independent director will preside at the executive sessions.

Board Meetings and Attendance

Under Avantor’s Corporate Governance Guidelines, all directors are expected to make every effort to attend all meetings of the Board, meetings of the committees of which they are members and any meeting of stockholders. Directors are encouraged to attend Board meetings and meetings of committees of which they are members in person but may also attend such meetings by telephone or video conference. The Board met 6 times in 2021, including regularly scheduled and special meetings. Each director attended 75% or more of the aggregate of all meetings of the Board and the committees on which he or she served during 2021.

Board and Committee Evaluations

The Board of Directors annually assesses the effectiveness of the full Board, the operations of its committees and the contributions of director nominees. The Nominating and Governance Committee oversees the evaluation of the Board as a whole and its committees, as well as individual evaluations of those directors who are being considered for possible re-nomination to the Board.

Director Independence and Independence Determinations

Under our Corporate Governance Guidelines and NYSE rules, a director is not independent unless the Board affirmatively determines that he or she does not have a material relationship with us or any of our subsidiaries (either directly or as a partner, stockholder or officer of an organization that has a relationship with us or any of our subsidiaries).

Our Corporate Governance Guidelines define an “independent” director in accordance with Section 303A.02 of the NYSE’s Listed Company Manual. In addition, Audit and Finance and Compensation and Human Resources Committee members are subject to the further independence requirements under SEC rules and NYSE listing standards. Our Corporate Governance Guidelines require the Board to review the independence of all directors at least annually.

In the event a director has a relationship with our company that is relevant to his or her independence and is not addressed by the objective tests set forth in the NYSE independence definition including any relationship described under “Certain Relationships and Related Person Transactions” below, the Board will determine, considering all relevant facts and circumstances, whether such relationship is material.

 

18    2022 Proxy Statement

The Board has affirmatively determined that each of Juan Andres, John Carethers, Matthew Holt, Lan Kang, Joseph Massaro, Mala Murthy, Jonathan Peacock, Michael Severino, Christi Shaw and Gregory Summe is independent under the guidelines for director independence set forth in our Corporate Governance Guidelines and the applicable NYSE listing standards, including with respect to committee memberships.

Committee Charters and Corporate Governance Guidelines

Our commitment to good corporate governance is reflected in our Corporate Governance Guidelines, which describe the Board’s views on a wide range of governance topics. Our Corporate Governance Guidelines and committee charters are reviewed from time to time by the various Committees and, to the extent deemed appropriate in light of emerging practices, revised accordingly, upon recommendation to and approval by the Board.

Our Corporate Governance Guidelines, our Audit and Finance, Compensation and Human Resources and Nominating and Governance Committee charters and other corporate governance information are available on the investor relations portion of our website at www.avantorsciences.com under “Investors: Governance.” Any stockholder also may request them in print, without charge, by contacting the Corporate Secretary: Avantor Inc., Corporate Secretary’s Office, Radnor Corporate Center, Building One, Suite 200, 100 Matsonford Road, Radnor, PA 19087.

Committees of the Board

There are three standing committees of the Board. The following table sets forth the Board committees, the members of each of the committees as of March 18, 2022 and the number of times the respective committees met in 2021:

 

 

    

		Audit and Finance		Compensation and Human Resources		Nominating and Governance
Juan Andres*		✓
John Carethers*						✓
Matthew Holt*				Chair
Lan Kang*		✓
Joseph Massaro*		Chair
Mala Murthy*		✓
Jonathan Peacock*						✓
Michael Severino*		✓		✓
Christi Shaw*				✓		✓
Gregory Summe*				✓		Chair
Michael Stubblefield
Number of 2021 meetings		8		4		5

 

*	Independent Director

Audit and Finance Committee

Our Audit and Finance Committee consists of Joseph Massaro, Juan Andres, Lan Kang, Mala Murthy, and Michael Severino, with Joseph Massaro serving as chair. Our Audit and Finance Committee is responsible for, among other things:

 

•

selecting and hiring our independent auditors, and approving the audit and non-audit services to be performed by our independent auditors;

 

•

assisting the Board of Directors in evaluating the qualifications, performance and independence of our independent auditors;

 

•

assisting the Board of Directors in monitoring the quality and integrity of our financial statements and our accounting and financial reporting;

 

•

reviewing the adequacy and effectiveness of our internal control over financial reporting processes;

 

•

reviewing with management and our independent auditors our annual and quarterly financial statements;

 

•

establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls or auditing matters and the confidential, anonymous submission by our employees of concerns regarding questionable accounting or auditing matters;

 

		2022 Proxy Statement    19

•

overseeing the Company’s internal audit function;

 

•

preparing the audit committee report that the Securities and Exchange Commission (the “SEC”) requires in our annual proxy statement; and

 

•

reviewing related-party transactions.

All members of the Audit and Finance Committee have been determined to be “independent,” consistent with our audit and finance committee charter, Corporate Governance Guidelines, SEC rules and the NYSE listing standards applicable to boards of directors in general and Audit and Finance Committees in particular. The Board has also determined that each of the members of the audit and finance committee is “financially literate” within the meaning of the listing standards of the NYSE. In addition, the Board has determined that each of Messrs. Massaro and Severino and Ms. Murthy qualifies as an “audit committee financial expert”, as defined by applicable SEC regulations. No committee member currently sits on more than two other public company audit committees.

Compensation and Human Resources Committee

Our Compensation and Human Resources Committee consists of Matthew Holt, Michael Severino, Christi Shaw and Gregory Summe, with Matthew Holt serving as chair. The Compensation and Human Resources Committee is responsible for, among other things:

 

•

reviewing and approving corporate goals and objectives relevant to the compensation of our CEO, evaluating our CEO’s performance in light of those goals and objectives, and, either as a committee or together with the other independent directors (as directed by the Board of Directors), determining and approving our CEO’s compensation level based on such evaluation;

 

•

reviewing and approving, or making recommendations to the Board of Directors with respect to, the compensation of our other executive officers, including annual base salary, bonus, equity-based incentives and other benefits;

 

•

reviewing and recommending to our Board of Directors with respect to the compensation of our directors; and

 

•

reviewing and making recommendations with respect to our equity compensation plans.

The Compensation and Human Resources Committee has sole authority to retain or terminate any compensation consultant or other advisor used to evaluate senior executive compensation and may form and delegate authority to subcommittees when appropriate. The Compensation and Human Resources Committee also approves all engagements and services to be performed by any consultants or advisors to the Compensation and Human Resources Committee. To assist the Compensation and Human Resources Committee in discharging its responsibilities, the Committee has retained an independent compensation consultant—Frederic W. Cook & Company (“FW Cook”). The consultant reports directly to the Compensation and Human Resources Committee. For additional information about the independence of the Compensation and Human Resources Committee’s consultant, refer to “Compensation Discussion and Analysis—Compensation Philosophy & Objectives—How We Make Compensation Decisions—Guidance from the Independent Compensation Consultant.” For more information on the responsibilities and activities of the Compensation and Human Resources Committee, including its processes for determining executive compensation, see the “Executive Compensation—Compensation Discussion and Analysis” section.

All members of the Compensation and Human Resources Committee have been determined to be “independent,” consistent with our Compensation and Human Resources Committee charter, Corporate Governance Guidelines, SEC rules and the NYSE listing standards applicable to boards of directors in general and Compensation and Human Resources Committees in particular. In addition, all members qualify as “non-employee directors” for purposes of Rule 16b-3 of the Exchange Act.

Nominating and Governance Committee

Our Nominating and Governance Committee consists of Gregory Summe, John Carethers, Jonathan Peacock and Christi Shaw, with Gregory Summe serving as chair. The Nominating and Governance committee is responsible for, among other matters:

 

•

assisting our Board of Directors in identifying prospective director nominees and recommending nominees to the Board of Directors;

 

•

overseeing the evaluation of the Board of Directors and management;

 

•

identifying best practices and recommending corporate governance principles;

 

 

20    2022 Proxy Statement

•

reviewing developments in corporate governance practices and developing a set of corporate governance guidelines;

 

•

recommending members for each committee of our Board of Directors; and

 

•

overseeing sustainability and corporate responsibility, including, ESG

COMMUNICATIONS WITH DIRECTORS

The Board of Directors welcomes input and suggestions. Stockholders and other interested parties may communicate with the Board and our Chairman by sending a written communication to the attention of the Company’s Corporate Secretary by mail at Avantor, Inc., Corporate Secretary’s Office, Radnor Corporate Center, Building One, Suite 200, 100 Matsonford Road, Radnor, PA 19087.

Communications addressed to the Board or to a Board member are distributed to the Board or to any individual director or directors as appropriate. Any such communication is promptly distributed to the director or directors named therein unless such communication is considered, either presumptively or in the reasonable judgment of the Company’s Corporate Secretary, to be improper for submission to the intended recipient or recipients. Examples of communications that would presumptively be deemed improper for submission include, without limitation, solicitations, communications that raise grievances that are personal to the sender, communications that relate to the pricing of the Company’s products or services, communications that do not relate directly or indirectly to the Company and communications that are frivolous in nature.

DIRECTOR NOMINATION PROCESS

Assess Composition and Determine Priorities

In 2021, the Nominating and Governance Committee considered the skills and experience outlined in our Director Skills Matrix to determine its priorities in seeking out new director candidates for the continuation of healthy Board refreshment. Specifically, it determined to recruit new directors who would add knowledge in the area of the healthcare regulatory environment, as well as depth in the areas of international business transactions, M&A and financial accounting.

Solicit and Source a Diverse Pool of Candidates

Working with the Chairman of the Board, the Nominating and Governance Committee sought out a diverse pool of candidates using multiple sources, engaging a third party search firm and receiving input from directors and stakeholders. The third party search firm assisted in identifying director prospects, performed candidate outreach, provided information about candidates and performed other related services.

Candidate Evaluation and Selection

The Nominating and Governance Committee evaluated candidates based on its set priorities, and the candidates’ qualifications, including each candidate’s strength of character, judgment, familiarity with the Company’s business and industry, independence of thought and an ability to work collegially with the other members of the Board. A diverse slate of candidates interviewed with the Nominating and Governance Committee and select members of management. Through this process, the Nominating and Governance Committee identified a number of qualified director candidates who together represented multi-faceted experience in the areas of finance, audit, international business transactions, and board level strategy and made a recommendation to the Board. In addition, Stockholders may nominate directors for election at the Company’s annual stockholders meeting by following the provisions set forth in the Company’s third amended and restated bylaws (“bylaws”).

2021 Board Refreshment

The 2021 additions of Dr. Carethers, Mr. Massaro and Mmes. Kang and Murthy evidence our focus on refreshment, drove a reduction in our average director tenure and further builds on our commitment to our DE&I agenda. Each has proven their ability to add valuable insights to the Company, providing experience from their diverse backgrounds to address the unique challenges facing the Company in 2022 and beyond.

 

 

		2022 Proxy Statement    21

Proxy Access

In January 2021, the Company amended its bylaws to include a proxy access provision that allows an eligible stockholder or group of up to 20 eligible stockholders, owning at least three percent of the Company’s outstanding stock continuously for at least three years, to include in the Company’s proxy materials for an annual meeting of stockholders a number of director nominees up to the greater of two directors or 20% of the Board of Directors, provided the stockholders and nominees satisfy the requirements specified in the bylaws.

CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS

The Board of Directors has adopted a written Related Person Transaction Policy to assist it in reviewing, approving and ratifying transactions with related persons and to assist us in the preparation of related disclosures required by the SEC. This Related Person Transaction Policy supplements our other policies that may apply to transactions with related persons, such as the Corporate Governance Guidelines of the Board and the Code of Ethics and Conduct.

Our Audit and Finance Committee is responsible for the review, approval and ratification of “related person transactions” between us and any related person pursuant to a written Related Party Transaction Policy adopted by our Board of Directors. “Related party transactions” include any transaction by the Company with a company or other entity that employs a “related party,” or in which a “related party” has a material ownership or financial interest. Under SEC rules, a related person is an officer, director, nominee for director or beneficial holder of more than 5% of any class of our voting securities since the beginning of the last fiscal year or an immediate family member of any of the foregoing. In the course of its review and approval or ratification of a related-person transaction, the Audit and Finance Committee will consider:

 

•

the nature of the related person’s interest in the transaction;

 

•

the material terms of the transaction, including the amount involved and type of transaction;

 

•

the importance of the transaction to the related person and to our Company;

 

•

whether the transaction would impair the judgment of a director or executive officer to act in our best interest and the best interest of our stockholders; and

 

•

any other matters the Audit and Finance Committee deems appropriate.

Each director and officer also completes and signs a questionnaire at the end of each fiscal year to confirm that there are no material relationships or related person transactions between such individuals and the Company other than those previously disclosed to Avantor. This ensures that all material relationships and related person transactions are identified, reviewed and disclosed in accordance with applicable policies, procedures and regulations.

Any member of the Audit and Finance Committee who is a related person with respect to a transaction under review will not be able to participate in the deliberations or vote on the approval or ratification of the transaction. However, such a director may be counted in determining the presence of a quorum at a meeting of the committee that considers the transaction.

Arrangements with our directors and officers

We have certain agreements with our directors and officers which are described in the sections entitled “Director Compensation” and “Compensation and Human Resources Committee Report” elsewhere in this proxy statement.

We entered into indemnification agreements with our officers and directors. These agreements and our bylaws will require us to indemnify these individuals to the fullest extent permitted under Delaware law against liabilities that may arise by reason of their service to us, and to advance expenses incurred as a result of any proceeding against them as to which they could be indemnified. The indemnification provided under the indemnification agreements will not be exclusive of any other indemnity rights. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, we have been informed that in the opinion of the SEC such indemnification is against public policy and may be unenforceable.

There is currently no pending material litigation or proceeding involving any of our directors for which indemnification is sought.

 

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In the normal course of business, we purchase services, supplies, and equipment from many suppliers and sell goods and services to many customers. In some instances, these transactions occur with companies with which members of our Board have relationships as executive officers. For transactions entered into during 2021, no related person had or will have a direct or indirect material interest.

While not required under the Related Person Transaction Policy, the Board reviewed certain transactions with Kite Pharma, a Gilead company, where Ms. Shaw serves as the Chief Executive Officer, AbbVie, Inc., where Dr. Severino serves as the Vice Chairman and President, Moderna Therapeutics, Inc., where Mr. Andres serves as the Chief Technical Operations and Quality Officer, and the University of Michigan Medical School, where Dr. Carethers serves as the Chair of the Department of Internal Medicine.

COMMITMENT TO SUSTAINABILITY

Our sustainability platform, Science for Goodness, aims to foster an inclusive work environment, promote innovation for a sustainable future, support and strengthen our communities, and add value to Avantor. We are embedding sustainability throughout our business ensuring our everyday actions generate positive impact.

Science for Goodness: Our Approach to Sustainability.

As a global industry leader, we recognize our ability to create a positive impact for our associates, customers, suppliers and communities. Throughout 2021, we advanced our environmental, social and governance (ESG) strategy across our four pillars — People & Culture, Innovation & Environment, Community Engagement and Governance & Integrity. These pillars are aligned with the following UN Sustainable Development Goals: Good Health & Wellbeing, Quality Education, Industry, Innovation and Infrastructure, Reduced Inequalities, and Responsible Consumption and Production.

We are committed to ensuring that, as our company continues to grow, our board and executive leadership team continue shaping a strong culture aligned to our values and governance.

Our impact and purpose is centered on four key commitment pillars:

 

People and Culture

We empower people to help create a better world

Innovation and Environment

Creating a sustainable future with smart solutions

Community Engagement

Taking action to build a better world

Governance and Integrity

Doing good as one

 

People and culture: We empower people to create a better world. Our values of Innovation, Customer centricity, Accountability, Respect, and Excellence—ICARE—give our associates a foundation for how we want to work together. We aim to foster a culture of collaboration and respect, dedicated to the safety of our associates, developing and retaining talent, providing equitable opportunities for all associates to grow and succeed. We’ve made considerable progress in our DEI and culture building.

 

Innovation and environment: Our innovation model is grounded in collaboration with a diverse and sophisticated customer base, designed to power innovation from scientific discovery to scale-up and commercial delivery. We also strive to increase our sustainable business practices through responsible consumption and production, including by addressing our greenhouse gas emissions, energy consumption, water usage, and waste, as well as through providing environmentally preferable products for our customers.

We recognize that climate change is a global challenge that poses a significant risk to human and environmental health and the way we do business. While relentlessly focusing on advancing life-changing science, Avantor has a shared responsibility and is committed to addressing climate change and other key environmental sustainability issues. In 2021, we announced our first environmental sustainability target to reduce our scope 1 (direct) and scope 2 (indirect) Greenhouse Gas (GHG) emissions by 15% by 2025.¹ To achieve this goal, we developed an energy and emissions reduction roadmap to invest in energy efficiency and conservation projects that will optimize our operational processes, in addition to lowering our operating emissions. This initial target serves as the first stepping stone on our long-term environmental sustainability journey.

 

1	Baseline data reported in metric tons of CO2 equivalents representing 61 sites globally reporting on emissions in 2019.

 

		2022 Proxy Statement    23

Community engagement: Our community engagement pillar seeks to strengthen the communities in which we live and work through grants from the Avantor Foundation, a private charitable foundation funded by Avantor, as well as engaging our associates to give back to the communities we serve through collection drives, volunteerism, and other means. Our giving and employee volunteer efforts are focused on 3 key areas: Science Technology Engineering and Math (STEM) learning, Healthcare to those in need, and Environmental stewardship.

 

Governance and integrity: We are committed to practicing responsible corporate governance, adhering to best practices, proactively identifying opportunities for process improvement, and elevating valued partnerships, both internally and externally. This commitment encompasses conducting business in full compliance with applicable laws and regulations, maintaining a high degree of internal conduct and communication standards through our Code of Ethics and Conduct and other internal policies, and partnering with over 1,500 diverse suppliers committed to high quality standards.

Management and Board Oversight

Avantor’s Executive Leadership Team (ELT), comprised of Avantor’s CEO, CFO, and executives from across the company, oversee Avantor’s efforts to integrate sustainability and corporate responsibility into Avantor’s strategic planning, risk management, and reporting. Day-to-day responsibility for Avantor’s ESG Program resides with a cross-functional representation of leaders headed by a newly created Senior Director, Global Sustainability position, who meet regularly to review progress and provide recommendations to the ELT.

At the Board level, the Board as a whole and through its independent Nominating and Governance Committee oversees sustainability and corporate responsibility, and was regularly updated in 2020 and 2021 as Avantor launched its enhanced ESG Program. These discussions included updates on the Company’s sustainability reporting and its goals under its four sustainability pillars. The full Board received a briefing from an outside consultant on the evolving climate landscape – including what investors expect – and our management team briefs them on what we hear from key customers and other stakeholders. The Board appreciates the magnitude of climate change and has fully supported management as we enhance our energy and emission management practices.

Other Board committees conduct detailed reviews on key ESG topics; for example, our Compensation and Human Resources Committee oversees the Company’s talent, culture, compensation structure and compensation programs. Twice a year, we report out on CEO and overall leadership succession, annual review of talent/ compensation philosophies, annual update on human capital KPIs and evaluating plan-linkage of ESG metrics to annual bonus plan. Our Audit and Finance Committee assists the Board in monitoring cybersecurity risk. We continued to adopt best-in-class governance provisions, including several enhancements to stockholder rights, and an enhanced supplier code of conduct.

Reporting

Per our commitment in last year’s Proxy statement, we evolved our 2020 social responsibility benchmark report into our first Avantor Corporate Sustainability Report that outlines progress made on our 4 ESG Pillars and states new public goals for climate action, employee health & safety, and diverse representation amongst our employee base. Further details with respect to our sustainability goals can be found on our website, www.avantorsciences.com, under “Investors: Sustainability.”

In developing this report, we conducted a materiality assessment to identify the environmental, social and governance topics most relevant to our company. As part of the process, we considered standards and guidance from the United Nations Sustainable Development Goals, reviewed topics prioritized by S&P Global, Dow Jones Sustainability Indices, Sustainalytics, CDP, EcoVadis and other pertinent corporate sustainability assessments, and gathered input from key external stakeholders.

We also consulted the Sustainability Accounting Standards Board’s (SASB) reporting standards for the Medical Equipment & Supplies, Biotechnology & Pharmaceuticals and Chemicals industries. As part of our continual improvement process, we will be formally incorporating the SASB reporting framework into our next Annual Sustainability Report released in 2022.

 

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CODE OF ETHICS AND CONDUCT

We have adopted a written Code of Ethics and Conduct that applies to all of the directors, officers and employees, including our President and Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer and other senior executive officers. Our Code of Ethics and Conduct sets forth policies and expectations on a number of topics, including conflicts of interest, compliance with laws, use of company assets, and our business practices. A current copy of the Code of Ethics and Conduct is posted on our website at www.avantorsciences.com under “Investors: Governance.”

If we ever were to amend or waive any provision of our Code of Ethics and Conduct that applies to our principal executive officer, principal financial officer, principal accounting officer or any person performing similar functions, we intend to satisfy our disclosure obligations, if any, with respect to any such waiver or amendment by posting such information on our website at www.avantorsciences.com rather than by filing a Form 8-K. In the case of a waiver for an executive officer or a director, the required disclosure also will be made available on our website.

 

		2022 Proxy Statement    25

Director Compensation

Our director compensation program is designed to attract and retain qualified non-employee directors. With assistance from FW Cook, we developed a market-based program that aligns director compensation with the compensation of our peers (our peer companies are identified on page 41). Our Compensation and Human Resources Committee reviews nonemployee director compensation regularly to confirm that it appropriately addresses time, effort, expertise, and accountability required of active board membership.

Director Fees

Our director compensation program provides for an annual cash retainer plus an annual equity award of restricted stock units.

 

 

    

Compensation Element		$
Annual Cash Retainer		75,000
Annual Equity Award		200,000
Chairman Cash Retainer		150,000
Lead Independent Director Cash Retainer		40,000
Committee Chair Cash Retainer       Audit and Finance Committee       Compensation and Human Resources Committee       Nominating and Governance committee		20,000 15,000 10,000
Committee Member Cash Retainer       Audit and Finance Committee       Compensation and Human Resources Committee       Nominating and Governance Commitee		10,000 7,500 5,000

Director cash retainers are paid quarterly in arrears. Director equity awards are issued in restricted stock units, which vest in full on the the first anniversary of the Vesting Start Date (as defined in the restricted stock unit agreement); provided, that if the director has continuously provided service to us upon the occurrence of a change in control prior to such dates, all then-unvested restricted stock units will vest. If an eligible director begins service after the start of a fiscal year but prior to the award of the annual equity-based retainer for such fiscal year, he or she will be eligible to receive the full amount of such retainer. Otherwise, the annual equity-based retainer will be pro-rated for partial years of service.

Each eligible director is also entitled to receive reimbursement for reasonable travel, lodging and other expenses which they properly incur in connection with their functions and duties as a director.

 

26    2022 Proxy Statement

The following table provides summary information concerning the compensation of the members of our Board of Directors for the year ended December 31, 2021. The compensation paid to Mr. Stubblefield, our President and Chief Executive Officer, is presented in the Summary Compensation Table and the other compensation tables above. During 2021, Mr. Stubblefield did not receive additional compensation for his services as a director.

 

 

    

Name		Fees Earned or Paid in Cash ($)(1)				Stock Awards ($)(2)				Option Awards ($)(3)				Non-equity Incentive plan compensation ($)				All Other Compensation ($)				Total ($)
Rajiv Gupta			225,000				200,003				—				—				—				425,003
Juan Andres			85,000				200,003				—				—				—				285,003
John Carethers(4)			36,569				93,135				—				—				—				129,704
Matthew Holt(5)			—				—				—				—				—				—
Lan Kang(4)			50,275				127,135				—				—				—				177,410
Joseph Massaro(4)			11,050				29,033				—				—				—				40,083
Mala Murthy(4)			15,710				35,083				—				—				—				50,793
Jonathan Peacock			126,923				200,003				—				—				—				326,926
Michael Severino			86,487				200,003				—				—				—				286,490
Christi Shaw			87,500				200,003				—				—				—				287,503
Gregory Summe			92,500				200,003				—				—				—				292,503
Andre Moura(6)			—				—				—				—				—				—
Jo Natauri(7)			—				—				—				—				—				—
Rakesh Sachdev(8)			36,813				200,003				—				—				—				236,816

 

(1)	Amounts reflect the director’s cash retainer earned for 2021. For Dr. Carethers, Mr. Massaro and Mmes. Kang and Murthy, the amount reflects pro-rated amounts earned since each joined the Board in 2021.

(2)

Amounts reflect restricted stock units granted under the 2019 Equity Incentive Plan and reflect the grant date fair value of the awards in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation — Stock Compensation (“Topic 718”) disregarding the effects of estimated forfeitures. The assumptions made in the valuation of our equity awards are found in Note 18 to our audited financial statements included in our annual report on Form 10-K for fiscal 2021. As of December 31, 2021, each of the following non-employee directors held the following restricted stock units: Mr. Gupta—7,236; Mr. Andres—7,236; Dr. Carethers—2,565; Ms. Kang—4,022; Mr. Massaro—745; Ms. Murthy—916; Mr. Peacock—7,236; Dr. Severino—7,236; Ms. Shaw—7,236; Mr. Summe—7,236.

(3)	No stock options were granted to directors in 2021. As of December 31, 2021, each of the following non-employee directors held the following stock options: Mr. Peacock—135,210; Ms. Shaw—135,210.

(4)	The following directors joined our Board in 2021: Ms. Kang, May 2021; Dr. Carethers, July 2021; Ms. Murthy, October 2021; and Mr. Massaro, November 2021.

(5)	Mr. Holt was initially nominated to the Board by New Mountain Capital and not eligible to be compensated for his service.

(6)	Mr. Moura resigned from our Board in April 2021.

(7)	Ms. Natauri resigned from our Board in May 2021.

(8)	Mr. Sachdev’s term expired in May 2021. In connection with Mr. Sachdev’s departure from our Board, the restricted stock units that he was awarded in 2021 were forfeited.

STOCK OWNERSHIP GUIDELINES

We have also adopted equity ownership guidelines for our non-employee directors in order to better align our eligible directors’ financial interests with those of our stockholders. Each non-employee director must own shares of Common Stock in an amount equal to four times (4x) his or her base annual cash retainer (excluding additional annual cash retainers for service as the Chairman of the Board of Directors, lead independent director, committee chairpersons and committee members). Such directors are required to achieve the applicable level of ownership within five years of becoming subject to the requirements.

 

		2022 Proxy Statement    27

Stock Ownership Information

AVANTOR STOCK OWNERSHIP

The following table sets forth information regarding the beneficial ownership of shares of our common stock as of March 15, 2022 by:

(1)

each individual or entity known by us to beneficially own more than 5% of our outstanding common stock,

(2)

each of our named executive officers,

(3)

each of our directors and

(4)

all of our directors and our executive officers as a group.

The amounts and percentages of shares beneficially owned are reported on the basis of SEC regulations governing the determination of beneficial ownership of securities. Under SEC rules, a person is deemed to be a “beneficial owner” of a security if that person has or shares voting power or investment power, which includes the power to dispose of or to direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities of which that person has a right to acquire beneficial ownership within 60 days. Securities that can be so acquired are deemed to be outstanding for purposes of computing such person’s ownership percentage, but not for purposes of computing any other person’s percentage. Under these rules, more than one person may be deemed to be a beneficial owner of the same securities and a person may be deemed to be a beneficial owner of securities as to which such person has no economic interest.

 

28    2022 Proxy Statement

Unless otherwise set forth in the footnotes below, (1) each beneficial owner possesses, to our knowledge, sole voting and investment power with respect to the shares listed, subject to community property laws where applicable, and (2) the address of each beneficial owner is c/o Avantor, Inc., Radnor Corporate Center, Building One, Suite 200, 100 Matsonford Road, Radnor, PA 19087.

 

 

    

Name of Beneficial Owner		Shares beneficially owned				Percent of total common stock(1)
Greater than 5% stockholders:
T. Rowe Price Associates, Inc.(2)			74,859,221				12.2	%
The Vanguard Group, Inc.(3)			50,319,888				8.2	%
Blackrock, Inc.(4)			43,769,070				7.1	%
Named executive officers and directors:
Michael Stubblefield(5)			5,434,996				*
Thomas Szlosek			1,457,666				*
Frederic Vanderhaegen			587,203				*
Gerard Brophy			32,942				*
Sheri Lewis			35,879				*
Rajiv Gupta(6)			1,057,456				*
Juan Andres			22,187				*
John Carethers			—				—
Matthew Holt			—				—
Lan Kang			4,022				*
Joseph Massaro			—				—
Mala Murthy			—				—
Jonathan Peacock			303,641				*
Michael Severino			17,258				*
Christi Shaw			133,483				*
Gregory Summe			14,818				*
All Executive Officers and Directors as a Group (19 persons)			9,705,710				1.6	%

 

*	Indicates beneficial ownership of less than 1% of the outstanding shares.

 

(1)

Applicable percentage ownership as of March 15, 2022 is based upon 610,276,869 shares of our common stock outstanding. Amounts include shares subject to stock options that are currently exercisable or are exercisable within 60 days as follows: Mr. Stubblefield (4,416,850), Mr. Szlosek (1,365,731), Mr. Vanderhaegen (557,335), Mr. Brophy (32,942), Ms. Lewis (25,752), and all current directors and executive officers as a group (7,955,438).

 

(2)

Based on information as of December 31, 2021 set forth in a Schedule 13G/A dated February 14, 2022. T. Rowe Price Associates, Inc. reported that it had sole power to vote 31,344,836 and sole power to dispose of 74,859,221 shares. No shared voting or dispositive powers were reported. The address for T. Rowe Price Associates, Inc. is 100 E. Pratt Street, Baltimore, MD 21202.

 

(3)

Based on information as of December 31, 2021 set forth in a Schedule 13G/A dated February 9, 2022. The Vanguard Group, Inc. reported that it had sole power to vote 0 shares, sole power to dispose of 49,041,541 shares, shared power to vote 555,729 shares, and shared power to dispose of 1,278,347 shares. The address for The Vanguard Group, Inc. is 100 Vanguard Blvd., Malvern, PA 19355.

 

(4)

Based on information as of March 11, 2022 set forth in a Schedule 13G/A dated March 11, 2022. BlackRock, Inc. reported that it had sole power to vote 40,306,589 shares, sole power to dispose of 43,769,070 shares and an aggregate beneficial ownership of 43,769,070 shares. The address for BlackRock, Inc. is 55 East 52nd Street., New York, NY 10055.

 

(5)

Includes 400,000 shares of common stock held by The Stubblefield GST Family Trust. Heidi Stubblefield, the wife of Michael Stubblefield, is the sole trustee of The Stubblefield GST Family Trust and has voting and investment power over the shares of common stock held by The Stubblefield GST Family Trust.

 

(6)

Includes (i) 556,218 shares of common stock held by The Gupta Family Trust and (ii) 287,571 shares of common stock held by The 2014 GST Family Trust. Kamla Gupta, the wife of Rajiv Gupta, is the sole trustee of The Gupta Family Trust and the 2014 GST Family Trust and has voting and investment power over the shares of common stock held by The Gupta Family Trust and the 2014 GST Family Trust.

 

		2022 Proxy Statement    29

DELINQUENT SECTION 16(A) REPORTS

Section 16(a) of the Exchange Act requires our directors, officers, and beneficial owners of more than ten percent of our common stock to file reports of securities ownership and changes in such ownership with the SEC. Based solely on our review of electronic filings with the SEC of such reports and written representations from our executive officers and directors, we believe that our directors, officers, and beneficial owners of more than ten percent of our common stock filed on a timely basis all reports required by Section 16(a) of the Exchange Act during 2021, except that one Form 4 for each of John Carethers and Lan Kang was inadvertently filed late by Avantor. A Form 4 for each was filed outside of the two-business day window in December 2021, reporting the equity grants received upon joining our Board.

 

30    2022 Proxy Statement

Item 2 Ratification of Appointment of Independent Registered Public Accounting Firm

The Board of Directors and the Audit and Finance Committee recommend that the stockholders ratify the selection of Deloitte & Touche LLP as our independent registered public accounting firm for the year ending December 31, 2022. The Audit and Finance Committee approved the selection of Deloitte & Touche LLP as our independent registered public accounting firm for 2022. Deloitte & Touche LLP is currently our independent registered public accounting firm.

Although the Company is not required to seek Stockholder approval of this appointment, the Board believes that doing so is consistent with good corporate governance practices. If the appointment is not ratified, the Audit and Finance Committee will explore the reasons for stockholder rejection and will reconsider the appointment.

We have been advised that a representative of Deloitte & Touche LLP will attend the Annual Meeting of Stockholders. Such representative will have an opportunity to make a statement if he or she desires to do so and will be available to respond to appropriate questions.

 

				The Board of Directors recommends a vote “FOR” ITEM 2, the ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm.

 

		2022 Proxy Statement    31

REPORT OF THE AUDIT AND FINANCE COMMITTEE

Management has the responsibility for the Company’s financial statements and overall financial reporting process, including the Company’s systems of internal controls. The independent registered public accounting firm has the responsibility to conduct an independent audit in accordance with generally accepted auditing standards and to issue an opinion on the accuracy of the Company’s consolidated financial statements and the effectiveness of the Company’s internal controls. The Audit and Finance Committee’s responsibility is to monitor and oversee these processes.

The Audit and Finance Committee has reviewed and discussed with management the Company’s audited consolidated financial statements for the year ended December 31, 2021. The Audit and Finance Committee has discussed with the Company’s independent registered public accounting firm, which is responsible for expressing an opinion on the conformity of the Company’s audited consolidated financial statements with generally accepted accounting principles and the matters required to be discussed under the applicable standards of the Public Company Accounting Oversight Board. The Audit and Finance Committee has received from the independent registered public accounting firm the written disclosures and the letter required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent registered public accounting firm’s communications with the Audit and Finance Committee concerning independence and has discussed with the independent registered public accounting firm its independence. In considering the independence of the Company’s independent registered public accounting firm, the Audit and Finance Committee took into consideration the amount and nature of the fees paid to the firm for non-audit services, as described below.

In reliance on the review and discussions described above, the Audit and Finance Committee has recommended to the Board of Directors that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, for filing with the SEC.

Respectfully submitted by the Audit and Finance Committee of the Board of Directors.

Joseph Massaro, Chair

Juan Andres

Lan Kang

Mala Murthy

Michael Severino

 

32    2022 Proxy Statement

AUDIT AND NON-AUDIT FEES

Deloitte & Touche LLP served as our independent registered public accounting firm for the fiscal years ended December 31, 2020 and 2021. Fees and expenses for services rendered by Deloitte & Touche LLP in 2020 and 2021 were approved by our Audit and Finance Committee. We have determined that the provision of these services is compatible with maintaining the independence of our independent registered public accounting firm.

The following table presents Deloitte & Touche LLP’s fees and expenses for services rendered to us for the past two fiscal years (in thousands):

 

 

    

		Year Ended December 31,
		2021				2020
Audit Fees(1)		$	4,852			$	4,596
Audit-Related Fees(2)			176				52
Tax Fees			—				—
All Other Fees			—				—
Total		$	5,028			$	4,648

 

(1)

Audit fees include fees for professional services rendered for (i) the audits of our annual financial statements, international statutory audits and the reviews of our interim financial statements, which were included in the year to which the audit or review related; (ii) the issuance of comfort letters and consents and incremental audit fees required for publicly-filed financial statements and comfort letters and consents related to public filings of Secondary Offerings and Private Placement Debt Offerings in 2021 and 2020.

(2)

Consists of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of the Company’s consolidated financial statements and are not reported under “Audit Fees” above. These services include accounting consultations relating to acquisitions, divestitures, and financings, due diligence related to mergers and acquisitions, financial accounting and reporting matters, and SEC filing related matters.

PRE-APPROVAL POLICY FOR AUDITOR SERVICES

The Audit and Finance Committee has the sole and direct responsibility and authority for the appointment, termination and compensation to be paid to the independent registered public accounting firm. The Committee has the responsibility to approve, in advance of the provision thereof, all audit services and permissible non-audit services to be performed by the independent registered public accounting firm as well as compensation to be paid with respect to such services.

Our Audit and Finance Committee Charter authorizes the Committee to delegate authority to pre-approve audit and permissible non-audit services to a member of the Committee. Any decisions made by such member under delegated authority, must be presented to the full Committee at its next scheduled meeting.

 

		2022 Proxy Statement    33

Item 3 Advisory Approval of Named Executive Officer Compensation

As required pursuant to Section 14A of the Securities Exchange Act of 1934, the Board of Directors is asking you to approve, on an advisory basis, the executive compensation programs and policies and the resulting 2021 compensation of the individuals listed in the 2021 Summary Compensation Table on page 50 (our “named executive officers”) as described in this proxy statement.

Because the vote is advisory, the result will not be binding on the Compensation and Human Resources Committee and it will not affect, limit or augment any existing compensation or awards. The Compensation and Human Resources Committee will, however, take into account the outcome of the vote when considering future compensation arrangements.

We believe you should read the Compensation Discussion and Analysis and compensation tables and also consider the factors below in determining whether to approve this proposal. As described in the Compensation Discussion and Analysis, the Compensation and Human Resources Committee has designed our compensation programs with the objective of driving sustained, meaningful and profitable growth and stockholder value creation through its focus on three long-standing Avantor compensation philosophies:

 

✓	Attract and Retain Talent. Executive compensation should be market-competitive in order to attract, motivate, retain and reward talented executives with a performance-driven mindset.

 

✓	Pay for Performance. A significant percentage of an executive’s compensation should be directly aligned with Company performance, with a balance between short-term and long-term performance.

 

✓	Align with Stockholder Interests. Executives’ interests should be aligned with stockholder interests through the risks and rewards of Avantor equity ownership.

The Board of Directors recommends the following resolution:

RESOLVED, that the compensation paid to the company’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion, is hereby APPROVED.

 

				The Board of Directors recommends a vote “FOR” ITEM 3, to approve, on an advisory basis, the compensation of the Company’s named executive officers, as stated in the above resolution.

 

34    2022 Proxy Statement

Executive Compensation

Compensation Discussion and Analysis

This compensation discussion and analysis (our “CD&A”) provides an overview of our executive compensation philosophy and the material elements of compensation awarded to, earned by, or paid to our named executive officers with respect to the year ended December 31, 2021.

Our named executive officers consist of our Chief Executive Officer, our Chief Financial Officer and our three other most highly compensated executive officers who served in the capacities listed opposite their respective names on December 31, 2021 (collectively, our “named executive officers”). For 2021, the named executive officers were:

 

 

Michael Stubblefield Director, President and Chief Executive Officer		Thomas Szlosek Executive Vice President and     Chief Financial Officer		Frederic Vanderhaegen Executive Vice President, Americas and Europe		Gerard Brophy Executive Vice President,     Biopharma Production		Sheri Lewis Executive Vice President, Global Operations and Supply Chain

This CD&A is divided into three sections:

 

Executive Summary		✓ 2021 Business Highlights ✓ Our Compensation Philosophy and Objectives ✓ 2021 Compensation Actions for Our Named Executive Officers ✓ Program Structure and Outcomes ✓ Our Executive Compensation Practices ✓ Key Changes to 2022 Executive Compensation Program
Compensation Philosophy & Objectives — How We Make Compensation Decisions		✓ Role of the Compensation and Human Resources Committee and our Executive Officers ✓ Guidance from Independent Compensation Consultant ✓ Benchmarking ✓ Accounting and Tax Considerations
Elements of Compensation — What We Pay and Why		✓ Base Salary, Performance-Based Cash Incentive Compensation, Long-Term Incentive Programs, Guaranteed, Sign-on and Discretionary Bonuses, Other Components, Severance Arrangements, 2019 Employee Stock Purchase Plan

 

		2022 Proxy Statement    35

EXECUTIVE SUMMARY

2021 saw the continued expansion of our position as a global leader of mission critical products and services to customers in the life sciences and advanced technologies and applied materials industries. We did this by embracing our critical role in providing services and solutions to all phases of the biopharma end market, from research & development to bioproduction, as well as supporting COVID-19 testing workflows and customized materials needed to produce vaccines and therapies. We deployed more than $4 billion in support of new acquisitions and continued to expand our relationships with our global strategic customers, developed new products and services, increased sales of proprietary products, expanded our manufacturing capabilities and continued the globalization of our best practices. The charts below provide certain financial measures that our management believes are useful in evaluating our performance.

 

 

See Appendix A for information about our non-GAAP financial measurements, including reconciliations to the most directly comparable GAAP-based financial measurements.

 

36    2022 Proxy Statement

Our Compensation Philosophy and Objectives

Each year our Compensation and Human Resources Committee thoroughly reviews our executive compensation program with guidance from its independent compensation consultant, FW Cook. Among the Compensation and Human Resources Committee’s objectives is to establish a public company executive compensation program that drives above-market results and is designed to attract, retain and motivate high-caliber, execution-oriented executives. In 2021, the Compensation and Human Resources Committee continued to build on its core philosophy by increasing the percentage of performance-based forms of compensation. We believe the following philosophies have facilitated our ability to compete for talent as a public company and have made a key contribution to our long-term success. Our primary executive compensation objectives are to:

 

Attract and retain talent		Provide a total compensation program that enables the company to attract, motivate, retain and reward high-performing executives, who have the ability to contribute to our success, and encourage management to place its primary focus on strategic planning and financial and operational priorities to ensure the achievement of our global strategy.
Pay for performance		Support a “pay-for-performance” orientation to provide differentiated rewards for strong financial, operating and individual performance, including the use of cash and equity incentive compensation payments based in part upon our performance to encourage the achievement of short-term and long-term financial and operational objectives.
Market competitive pay		Align the interests of management with those of our other stockholders thereby providing an incentive for, and rewarding, the attainment of objectives that also benefit our stockholders.

2021 Compensation Actions for our Named Executive Officers

Summary of Actions

Consistent with our executive compensation philosophies and objectives, in establishing 2021 compensation for our named executive officers, the Compensation and Human Resources Committee considered each named executive officer’s prior performance, compensation levels paid to similarly situated officers at the Company, market data and input from the Compensation and Human Resources Committee’s independent compensation consultant, FW Cook. For 2021, the Compensation and Human Resources Committee made the following material decisions with respect to the compensation of our named executive officers:

 

•

compared the base salaries of our executive officers to our compensation peer group and publicly available global salary surveys for organizations of similar size and revenue;

 

•

maintained an incentive compensation plan focused on a combination of performance measures that align closely with the performance measures that are used by management to set business goals and evaluate our financial results (See “Elements of compensation — What we pay and why — Performance-Based Cash Incentive Compensation”); and

 

•

granted annual equity awards to each of the executive officers after considering our compensation philosophy and the assessment of the executive officer’s expected future contributions, increasing the weighting of performance stock units from one-third to one-half with the remainder of the award being made in a mix of stock options and restricted stock units.

 

		2022 Proxy Statement    37

Program Structure and Outcomes

The following table provides a summary of the compensation program and performance outcomes for our named executive officers in 2021:

 

 

    

Component		Proportion of Total Target Pay		Structure/Metrics/Features		2021 Performance Outcomes
Base Salary		• CEO: 10%		• Base salary aligned with others in our peer group and broader market		• Not Applicable
		• Other NEOs: 9%
Short-Term Incentives		• CEO: 16%		Structure:		• All metrics achieved above target
		• Other NEOs: 8%		• 100% performance-based cash incentive		• ICP earned at 196.8% of target
				Metrics & Weightings:		• No discretion exercised
				• 45% Sales Growth
				• 35% Adj. EBITDA
				• 20% Net Working Capital as a percentage of sales
				Features:
				• Rigorous pre-set goals
				• Company achievement capped at 200% of target
Long-Term Incentives		• CEO: 74% • Other NEOs: 83%		Structure: • 1/2 performance stock units		• Not Applicable
				• 1/4 stock options
				• 1/4 restricted stock units
				Metrics & Weightings (for performance stock units):
				• 50% Cumulative Adj. EPS Growth
				• 50% TSR relative to comparator group
				Features:
				• 3-year performance period and cliff-vesting for performance stock units
				• Rigorous pre-set goals
				• 4-year ratable vesting for stock options and restricted stock units

 

38    2022 Proxy Statement